Available evidence suggests the market for RFID systems is still confined to a relatively small group of early pragmatists.

By Mark Roberti

A while back, I was talking to a marketing executive at a company that provides RFID solutions. He said, "My sales team thinks that there must be a lot of potential customers out there who do not read RFID Journal or attend RFID Journal events." I hear more or less the same thing from time to time from other solutions providers frustrated at their inability to obtain more business.

And it's not just solutions providers—I believe almost every company on Earth can benefit from deploying radio frequency identification. So it would seem that there are a lot of potential customers out there that no one has yet discovered. But, unfortunately, the evidence indicates that this untapped pool of RFID customers simply does not exist. That's because the market is still in the early stages of adoption.

You may have the best product and a sound argument, but at this point in the adoption cycle, you will be unable to convince most potential end users to invest in RFID technology. Geoffrey Moore, the author of Crossing the Chasm and other seminal works on how new technologies are adopted, says that even though many companies can benefit from a new technology, most will choose not to adopt until that technology reaches a critical mass.

In fact, many of these potential end users aren't even ready to learn about RFID technology in any kind of depth—and people need information before they will buy a solution. I speak at numerous vertical industry events, explaining the benefits of RFID. We also exhibit at these conferences, giving away special subscription offers or flyers with a discount to our own events. These efforts produce almost no results. One year, we gave away 2,000 RFID Journal magazines with a special offer at a supply chain event. We didn't obtain a single subscriber as a result.

Every year, we mail brochures for our RFID Journal LIVE! conference and exhibition to our partners' lists. We've sent e-mails to those lists, and we've advertised on our partners' Web sites. Occasionally, we've run ads on media sites promoting specific industry content at LIVE!, or in webinars. This year, for instance, we ran a banner ad on Women's Wear Daily for a free webinar offered by Lord & Taylor and Jockey International, as well as free item-level RFID workshops. The response to these efforts is always disappointing.

If we can't convince people to attend an RFID Journal event or a free webinar, it seems highly unlikely they are going to turn around and invest in an RFID system. (I can usually tell when a company is serious about RFID, because the number of executives from that firm who attend an event or participate in a webinar rises from one or two to five, six or more.)

I, like you, find it endlessly frustrating that more companies are not investing in RFID. But if someone is not yet ready to do something—whether it's dieting, exercising or investing in technology—you can't convince them to do so, even if it's beneficial to them.

Moore suggests that RFID companies focus on the few early adopters willing to take a chance on a new technology, or that have a problem serious enough to warrant taking a chance. I believe he's right—this is the key to growing the RFID market.

I believe there is a great pool of untapped customers for RFID-based solutions but that the vast majority would never think to read RFID Journal or attend RFID Journal Live! because they do not know that what they need is RFID. They have painful problems and it is solutions to those problems that really drive adoption. Look at the proliferation of location services on smartphones - it is not about GPS, but about maps and local deals, etc.

Carrie, I thought that too for many years, but the evidence doesn't support this view. There are more than 1,000 RFID companies out there trying to sell RFID solutions. If your theory was correct, they would be meeting people, explaining how RFID can solve their problem, and winning business. But nine years after Walmart put RFID on every executive's radar, most RFID companies are struggling to find customers. Second, awareness of RFID is very high. The knowledge admittedly is not deep, but I recently spoke to a group of executives who run the departments in their hospitals who manage assets. Everyone one of them said they know what RFID is, what it does and that their hospitals would benefit from it. Yet, only one was considering deploying an active RFID system to track assets. I've had similar experiences at retail, manufacturing, logistics events. I absolutely agree that every company can benefit from RFID, but that doesn't mean every company is going to deploy at this stage. I never understood why until I read Geoffrey Moore's books, Crossing the Chasm and Inside the Tornado. Moore explains why people who can benefit from a technology don't deploy it until it reaches critical mass, and he explains why providers of new technologies need to focus on the very small group who have problems and are willing to take a chance to address them Then, you use that customer to get another and another and another. When you achieve critical mass, then everyone does it. What I've seen over the past 10 years supports everything Moore says.

Mark – We agree here, the emphasis needs to be on solution, not on technology. Perhaps RFID is still seen as a tool, not a solution - something that enables more work towards a solution instead of directly solving the problem.
Maybe getting RFID into the corporation from the top down is not going to be the most successful path. Like cell phones, laptops and tablets, many corporations adopt technologies that come from the bottom up, where the employees force the adoption of technologies that solve problems in their lives because they see how these technologies can solve problems in their work. If we can provide products for direct consumer use, that could drive RFID into corporate.